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Dean's Daily FX Update – 11 October 2017
In the Zone
- EURUSD
- GBPUSD
- USDJPY
- Dax
- FTSE
Noteworthy News
- The recent winner of the Nobel Prize in economics confirmed in a statement that despite the risky nature of the world at present the equity markets continue to climb, he went on to confess that he doesn’t understand this – I’m glad that we are not the only ones then.
Recap
Other than further squabbling between the Democrats and Republicans, there was not much in the way of market movers during New York yesterday. The market instead shifted its focus towards developments in Europe and whether Catalonia would declare independence from Spain, in typical EU fashion the can was kicked down the road – the President of Catalonia declared a deferred independence, meaning that the possibility is still alive but not official.
It was probably the right decision and the EURUSD traded higher on this result, it starting finding some resistance at the 100 hour MA at 1.1825. The sellers will be a little bit concerned that the pair did not trade lower and even more concerned that support was found at 1.1800. The 100 hour MA at 1.1825 becomes the line in the sand today, a move higher is bullish and trading lower that 1.1800 is bearish. The charts are giving conflicting views and so I would prefer to trade off the longer term daily charts today, I would feel more comfortable looking for shorts closer to 1.1900.
Flying a little bit under the radar at the moment, there is continued rumours that the BOE could tighten sooner than expected and this is the catalyst for the GBPUSD to trade higher. The 100 hour MA trades at 1.3150 and I suspect that buyers will lean against this level if we see any dips lower, the target could very well be the 200 hour MA at 1.3235, this is a level I will be watching and will be a little bit more comfortable trading at.
AUDUSD seem to be a little nervous around the 100 day MA at 0.7790 and has spent most of the last 2 days trading between 0.7790 and 0.7775. That 100 day MA is going to be key for the buyers, and on the downside a break lower than 0.7730 looks to be the key level to watch for the sellers.
As mentioned in the morning video, the major FX pairs are showing conflicting views and so could prove to be a little tricky this week, I have instead turned my attention to the Dax and FTSE and feel that there could be some lower risk trading opportunities in these instruments.
Important Economic Data out today
20:00 USD FOMC Meeting Minutes
Consensus: None
Effect: More hawkish than expected is good the USD
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